Gamesa Record performance and higher guidance: creating value at - - PowerPoint PPT Presentation
J a n u a r y - S e p t e m b e r 2 0 1 6 R e s u l t s Gamesa Record performance and higher guidance: creating value at cruising speed 10 November 2016 1 1 January-September 2016 Results Contents 1. Period highlights 2. January-September
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J a n u a r y - S e p t e m b e r 2 0 1 6 R e s u l t s
January-September 2016 Results
10 November 2016
2 2
January-September 2016 Results
3 3
January-September 2016 Results
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Growth-oriented competitive positioning
Management focused on value creation, ROCE: 23%
Through profitable growth and control of the operating break-even point
focused investment (working capital and capex),
and a sound balance sheet
Upward adjustment in volume and EBIT guidance for 2016
Progress in the long term strategy of value creation: Gamesa shareholders approved the merger with Siemens Wind Power
1. Firm orders and confirmation of framework agreements for delivery in the current and subsequent years, including 498 MW signed in Q3 16 and announced in Q4 16. 2. Growth using underlying figures pre-Adwen, excl. €29mn at EBIT level in 9M 15 (no impact in 9M 16) and €4mn at net profit level in 9M 15 and -€18mn in 9M 16. January-September 2016 Results
5 5 Europe & RoW USA APAC India LatAm 1,007 2,841 3,990 3,034 1,090 3,301 4,343 3,242 Order intake Q3 Order intake 9M Order intake LTM Order backlog @sept 2015 2016
High visibility on growth in 2016 and 2017
4,300 MWe)
1,090 MW of new orders1 in Q3 16 (+8% y/y), 3,301 MW in 9M (+16% y/y) and 4,343 MW in the last 12 months (+9% y/y)
1. Firm orders and confirmation of framework agreements for delivery in the current and subsequent years, including 498 MW signed in Q3 16 and announced in Q4 16. 2. Coverage based on total order intake through 30 September 2016 for activity in 2016 with respect to volume guidance for 2016 @ Nov. 16 ≥ 4,300 MWe. Change y/y
Strong commercial performance (MW)1
January-September 2016 Results
Geographical diversification of order intake in 9M 16 (%)1
Strong commercial activity in USA, APAC and India G114-2.0 MW and G114-2.5 MW: 59% of orders 9M 16 (vs. 47% in 9M 15)
Ratio of order intake to sales in the period (book-to-bill) 3,301 MW 1.0X 1.0X 1.1X 8% 16% 9% 7%
6 6 2,301 819 3,256 1,076 9M Q3 2015 2016 2,188 761 2,996 1,032 9M Q3 2015 2016 2,533 882 3,339 1,147 9M Q3 2015 2016
+32% y/y in 9M 16 and +30% y/y in Q3 16 supported by strong growth in wind turbine sales
Sales trend year-on-year Group revenues (€mn) WTG sales (€mn) WTG activity (MWe)
January-September 2016 Results
Sales in 9M 16 at constant exchange rates1 rose 39% y/y vs. 32% in real terms, reflecting a 7-point currency impact on sales growth
Change y/y 1. At the 9M 2015 average exchange rate. 32% 30% 37% 36% 42% 31%
7 7 1,942 2,533 3,339 185 210 252 9M 14 9M 15 9M 16 Sales Structural expenses
The operating break-even point is maintained as a critical area of management focus: structural expenses/revenues: 7.6%
Trend in revenues and structural expenses1 (€mn)
1. Structural expenses with a cash impact (excluding D&A),
Goal of BP15-17E: Fixed expenses1/revenues <8% in 2017
January-September 2016 Results
Structural expenses/revenues in the period 9.5% 8.3% 7.6%
8 8 122 36 225 73 9M Q3 2015 2016 206 71 340 110 9M Q3 2015 2016
Rising sales Strict control of structural expenses Ongoing optimisation of variable expenses Net negative currency effect is under control
EBIT increased by 65% y/y in 9M 16 and by 56% y/y in Q3 16, while net profit doubled. The EBIT margin in 9M 16 was over 10%: 2 percentage points more than in 9M 15
EBIT margin 1. Underlying EBIT pre-Adwen excluding €29mn in capital gains from creating Adwen in 9M 15 (no difference with respect to reported EBIT in 9M 16). Underlying net profit pre-Adwen excluding impact of consolidating Adwen (-€18mn) in 9M 16 and the impact of capital gains and of consolidating Adwen in 9M 15 (€4mn in total).
EBIT (€mn)1
Change y/y (%) January-September 2016 Results %
Net profit (€mn) 2
Change y/y (times) +2.0 p.p. +1.6 p.p. 1.8x 10.2% 9.6% 2.0x 8.0% 8.1% 65% 56%
9 9 143
301 167 Net cash 12/31/14 Operating CF Var.Wkg C. Capex Other Dividend 2015 Net debt 09/30/15 Operating CF Var.Wkg C. Capex Other Net cash 12/31/15 Operating CF Var.Wkg C. Capex Other Dividend 2016 Net cash 09/30/16 FCF 9M 15:
FCF 9M 16:
210 167 NFD 09/30/15 Operating CF
Capex Other Net cash pre- dividend 09/30/16 Dividend Net cash 09/30/16
Maintaining the focus on cash flow: cash consumption reduced by 51% in 9M 16 vs. 9M 15, and €279mn generated in net free cash flow1 in the last twelve months
cash flow
15)
months
Improved
profitability
twelve months
Control of working capital
growth: Opening capacity and introducing new products
in the last twelve months
Focused capex
NFD and FCF2 performance in the first nine months (€mn) NFD y/y (€mn)
January-September 2016 Results
51% improvement
+€279mn 1. Net cash pre-dividend 2. FCF (€mn): net free cash flow pre-dividend 416 112
10 10 7.0% 7.9% 14.2% 22.9% 9M 13 9M 14 9M 15 9M 16
+9 p.p. increase in ROCE 1 in 9M 16 vs. 9M 15
ROCE1
Profitable growth through
variable costs, plus quality leadership
even point
VALUE CREATION PILLARS
Strong balance sheet
modular capex focused on assuring expected growth
January-September 2016 Results
Cash flow
1. ROCE: LTM EBIT*(1-t)/average capital employed. Average capital employed is calculated as the arithmetic mean of capital employed between the beginning of the current year and the end of the
+0.8 p.p. +6.3 p.p. +8.7 p.p.
5% 5% 0% 8% 11% 17% 23% 2010 2011 2012 2013 2014 2015 9M 16
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Accident frequency and severity indices improved ahead of the objectives in the BP 15-17
Accident frequency index1 Accident severity index2
1 Frequency index: No. of accidents with days lost * 106/No. of hours worked 2 Severity index: No. of days lost * 103/No. of hours worked
January-September 2016 Results 0.127 0.093 0.074 0.055 0.054 0.023 0.025 2010 2011 2012 2013 2014 2015 YTD 16
Objetive BP 2015-17E: 0.049
4.11 4.05 2.39 1.74 1.72 1.08 0.95 2010 2011 2012 2013 2014 2015 YTD 16
Objetive BP 2015-17E: 1.5
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January-September 2016 Results
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Underlying P&L pre-Adwen1 (€mn) 9M 2015 9M 2016
Q3 16
Group revenues 2,533 3,339 31.8% 1,147 30.1% MWe 2,301 3,256 41.5% 1,076 31.3% O&M revenues 345 343
115
Underlying EBIT 206 340 64.9% 110 55.7% Underlying EBIT margin 8.1% 10.2% 2.0 p.p. 9.6% 1.6 p.p. O&M EBIT margin 11.7% 12.7% 1.0 p.p. 10.6% 1.0 p.p. Underlying net profit (NP) 122 225 83.6% 73 101.7% Underlying NP per share (€) 0.44 0.81 82.8% 0.27 101.2% Reported P&L (€mn) EBIT2 235 340 44.5% 110 55.7% Net profit2 126 206 63.3% 69 135.2% Balance sheet (€mn) Working capital (WC) 365 253
253
WC/revenues LTM 10.6% 5.9%
5.9%
Net financial debt (NFD) 70
2. Reported EBIT and NP are purely accounting figures and include the impact of creating and consolidating Adwen (offshore JV): €29mn of capital gains in EBIT and €4mn in net profit in 9M 2015. 9M 2016 net profit includes a negative impact of €18mn from consolidating Adwen's operations. There are not non-recurring items in 2016. 1. The 50% stake in Adwen is carried by the equity method. The figures in the table above exclude Adwen and also exclude the impact of non-recurring items. In 2016 there are no non- recurring impacts. Number of shares for EPS calculation purposes: in 2015: 276,120,607 (9M) and 276,123,824 (Q3) and in 2016: 277,337,699 (9M) and 276,888,950 (Q3). There are not non-recurring items in 2016. January-September 2016 Results 3. Working capital: Inventories + Trade and other accounts receivable (inc. related companies) + Due from public authorities + Other receivables - Trade and other accounts payable (inc. related companies) - Due to public authorities - Other current liabilities exc. financial items amounting to €8.7mn in 9M 2016. 4. Net financial debt/cash: Financial debt (current and non-current) + financial derivatives (current and non-current liabilities) + other non-current financial liabilities (excluding €6mn non-financial) + current financial liabilities (€8.7mn in 9M 16) - cash and cash equivalents - other current financial assets - financial derivatives (assets)
14 14 1.00 0.96 0.95 0.95 0.90 0.90 0.92 0.93 0.96 Q1 15 H1 15 9M 15 FY 15 Q1 16 H1 16 9M 16 Q3 15 Q3 16 712 1,481 2,301 3,180 1,061 2,180 3,256 819 1,076 Q1 15 H1 15 9M 15 FY 15 Q1 16 H1 16 9M 16 Q3 15 Q3 16
Activity: MWe sold
January-September 2016 Results 42% 31%
WTG revenues/MWe (ASP1 €mn)
%
Strong growth in volume: +42% y/y in M9 and +31% in Q3, and a recovery in assembly activity with a positive impact on ASP from Q3 onwards
Change y/y % Change y/y
Activity trend supports attaining new minimum sales volume target for 2016E ≥ 4,300 MWe Trend in ASP1 aligned with expectations:
incipient recovery in assembly with a positive impact on ASP from Q3 onwards. MW assembled/MWe ratio:
15 15
Activity continues to be shaped by diversification in terms of geographies and clients
Geographic mix (MWe sold) Breakdown of MWe sold, by customer type
Commercial presence in 18 countries 36,958 MW installed in 54 countries Relations with over 200 customers (utilities, IPPs, financial investors and self-providers)
January-September 2016 Results 20% 12% 8% 34% 27% Europe & RoW USA APAC India LatAm 49% 40% 11% IPP Utilities Other
16 16 52 107 166 230 105 199 297 59 98 Q1 15 H1 15 9M 15 FY 15 Q1 16 H1 16 9M 16 Q3 15 Q3 16
Rising manufacturing profitability: +79% y/y in 9M 16 and +66% y/y in Q3 16, supported by sales volume, fixed cost containment and continuous improvement of variable costs, offsetting the higher competitive pressure
EBIT1 WTG (€mn) Design improvements Improvements in competitiveness (Processes) Working with suppliers
Continuous improvement programmes
EBIT margin (%) January-September 2016 Results % Change y/y
Focus on break-even point: Fixed cost contention
1. Underlying EBIT coincides with reported EBIT since there were no non- recurring items in the WTG division in 2015 or 2016 79% 66% 9.9% 7.6% 9.5% 7.7% +2.3 p.p. +1.7 p.p.
17 17 345 40 121 12 343 44 115 12 9M Sales 9M EBIT Q3 Sales Q3 EBIT 2015 2016
Aligned with 2016 guidance and BP 15-17E: management focused on cost improvement ensures profitable growth in 2016 and thereafter, and the recovery in the fleet under maintenance and the
January-September 2016 Results
Fleet evolution (GW)
Revenue growth to resume in 2017 supported by growth in fleet size and
Firming recovery of fleet under maintenance as a result of growth in emerging markets and improved renewal rate
Q3 vs. 69% in Q2 and 25% in Q3 15 Order book +15% y/y (>2,300 MM €)
Revenues and EBIT (€mn)
O&M EBIT margin1 1. Underlying EBIT including corporate and structural expenses Underlying EBIT matches reported EBIT as there were no non-recurring items
%
Management plan offsets pressure on prices and contract scope and ensures profitable growth in 2016 and thereafter:
In an environment of scope reduction and price pressure revenues in 9M and Q3 were affected by
21.2 20.6 20.6 21.0 22.3 22.4 23.0 15.6 14.9 15.2 15.3 15.5 15.5 16.1
Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 GW under maintenance GW post warranty
7.5%
4.0% 11.7% 12.7% 9.7% 10.6% 6.1% 11.4%
18 18
Margin improvement levers aligned with 2016 projections Positive impact of Growth in volume Optimisation of variable costs (inc. raw materials) Favourable project scope and mix Partly offset by Adverse exchange rate effect Lower O&M contribution to sales mix Higher fixed expenses, including D&A, needed to grow, and in line with increase in capex
Greater activity, continuous improvement of variable costs, and a favourable project mix were the main factors driving growth in EBIT margin in M9 16. Trend in line with guidance for the year
EBIT margin (%)
January-September 2016 Results 8.1% 10.2% EBIT margin 9M 15 Volume Variable cost WTG / O&M mix Project mix Fixed cost (D&A inc.) FX EBIT margin 9M 16 2.7% 0.7%
19 19 8.3% 21.1% 16.8% 16.8% 2.5% 12.8% 8,5% 10.6% 0.3% 4.1% 3.2% 5.9% Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 WkC o/ sales 20131: 21% WkC o/ sales 20141: 13% WkC o/ sales 20151: 7% 365 253 9M 15 9M 16
≥4.300 MWe E 3.180 MWe
+42%/ ≥35%
Optimisation of working capital with record levels of activity
Reduction in working capital (€mn) Improvement in working capital/revenues LTM is secure
Reducing working capital in a context of rising activity as a result of policies to Align manufacturing with deliveries and receipts Actively manage accounts payable and receivable Control capex in wind farms, and monetise operational assets Trend in 9M 16 vs. 9M 15 aligned with guidance for 2016 average working capital LTM (end September) €140mn Average ratio of working capital/revenues LTM: 3.2% in 9M 16 vs. 8% in 9M 15 Sequential increase in line with business seasonality
WC/revenues LTM (%) Activity volume 12M/guidance (Nov. 16) Activity volume 9M Change in WC/revenues ratio in 9M 16 vs. 9M 15 Reduction in av. working capital (€mn)
January-September 2016 Results 2.301 MWe 3.256 MWe 5.9%
10.6%
20 20
Control of net debt/(cash) position in a context of rising activity Activity (MWe): +42% y/y Supported by Rising profitability Control of working capital Focused capex Reduction in net cash position vs. Dec. 2015 due to normal seasonal fluctuations in the business
Sound balance sheet in a context of strong growth
NFD trend y/y in 9M (€mn)
Access to c. €1,800mn in credit lines and no significant maturities in the plan horizon
Sales volume Net free cash flow 12 months (pre-dividend) Dividend payments (Q3 15 and Q3 16) NFD/(Net cash) January-September 2016 Results MWe 1,832 MWe 2,301 MWe 3,256 MWe
308 70
9M 14 9M 15 9M 16
+261 +279
21 21
January-September 2016 Results
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January-September 2016 Results On 5 October 2016, the threshold for the entry into force of the Paris Agreement was attained, as 86 countries accounting for at least 55% of total emissions had signed it. The agreement will come into force 30 days later (4 November 2016). Source: UNFCCC "We are witnessing a transformation of global power markets led by renewables … Part of the growth was caused by falls in the cost of solar and
ago." "Average global generation costs for new onshore wind farms fell by an estimated 30 per cent between 2010 and 2015 … The Agency (says) costs are likely to fall even further over the next five years, by 15 per cent …" "It has revised its five-year forecasts to show renewables’ capacity will grow 13 per cent more than its estimate made [in 2015], mostly because of stronger policy backing in the US, China, India and Mexico.“ Source: IAE (Financial Times 25/10/2016)
Supported by growing wind competitiveness: LCOE down 16% in onshore and 22% in offshore1, and by renewable commitments: entry into force of the Paris Agreement
Wind power price in LatAm auctions 2016 (Source: BNEF. USD/MWh) LCOE prospects H2 16 (Source: Bloomberg New Energy Finance/BNEF. USD/MWh)
22% 16% 1. Bloomberg New Energy Finance: LCoE comparison in H2 2016 vs. H1 2016 Offshore tenders in Netherlands and Denmark resulted in prices <100€/MWh 53 45 38 36 Brazil Chile Peru Mexico
23 23 3,330 2015 2016E 2017E 2018E 2019E 2020E Offshore 23,557 9,481 2015 2016E 2017E 2018E 2019E 2020E Mature Emerging 62,438 33,038 2015 2016E 2017E 2018E 2019E 2020E Total Total ex-China CAGR 15-20E: 9% CAGR 15-20E: 1% CAGR 15-20E: 1%
Source: MAKE Q3 2016 Source: MAKE Q3 2016
Resultados Enero-Septiembre 2016
…and offshore which is expected to grow at a high double digit compounded annual rate from 2016E to 2020E, reaching a cumulative installation level of 35 GW to 40 GW
CAGR 15-20E: 3%
Source: MAKE Q3 2016
CAGR 16E-20E: 38% CAGR 15-20E: 16%
Growth is still being sustained by the emerging economies…
Wind installations ex-China1 2015-2020E (MW) 1 Wind installations1 2015-2020E (MW) 1 Offshore wind installations 2015-2020E (MW)
24 24 206 340 294 >400 ≥430 450-470 9M 15 9M 16 FY 15 Outlook Feb 16 Outlook Jul 16 Outlook Nov 17 2,301 3,256 3,180 >3,800 ≥4,000 ≥4,300 9M 15 9M 16 FY 15 Outlook Feb 16 Outlook Jul 16 Outlook Nov 17 January-September 2016 Results
Prospects for commercial strength and profitable growth beyond 2016 remain intact
42% ≥35% 19% +5% +8% 19% +8% +5% c.56% 65% 8,1% 10,2% ≥9% 8,4% ≥9.5%
+0.6 p.p. +0.5pp +0.5pp +2pp
New commitments1: 2016 sales volume ≥4,300 MWe and EBIT €450-470mn, equivalent to a margin
Sales volume and guidance (MWe) EBIT and EBIT margin performance and guidance (€mn/%)
1. At 9M 2016 average exchange rate and assuming no change in consolidation scope EBIT margin (%) Change y/y Guidance Nov.
Interim changes Guidance Nov. vs. FY 15 Interim changes Guidance Nov.
25 25 Proforma merged company (excluding synergies and integration costs) Sept16
January-September 2016 Results Gamesa AGM October 2016 Siemens Wind Power carve out commences/ May 2016 End of carve out Q4 16 /Q1 17 Payment of the cash component2 12 business days after the merger Merger takes effect End Q1 2017 TENTATIVE CALENDAR Authorisation by CNMV and competition authorities1 Q4 16/Q1 17
Improving the competitive position and value-creation prospects for 2017 and thereafter in a market increasingly dominated by the cost of energy (LCOE)
diversification
sheet
service offer
expanding profitable growth + Synergies
Maintaining a management approach focused on profitable growth and cash flow generation
Adwen
(Wikinger) and 1.5 GW of preferential agreements (French auction)
(Q4)
accounted 1. At the date of this presentation, the deal has been cleared by China, India and Brazil 2. Extraordinary Shareholders' Meeting 3. Including normalization adjustments (-€9mn), standalone (+€121mn) and consolidation scope (-€10mn) as of September 2016
Sales LTM (‘000 MM €) EBIT LTM (MM €) y margin EBIT 3 (%)
18,4% 12,0%
Margin EBIT (%) Proforma merged company 3 Margin EBIT (%) Gamesa Margin EBIT (%) SWP 3
3,7 4,3 5,5 6,0 LTM Mar 16 LTM Sept 16 Siemens Wind Power Gamesa 347 427 492 566 LTM Mar 16 LTM Sept 16 Siemens Wind Power Gamesa
+9,1% +8,9% +9,4% +9,6% +9,4% +9,9%
@Mar 16)
26 26
January-September 2016 Results
27 27
Record order intake in Q3 16: 3.3 GW1, +16% y/y (1.1 GW in Q3 and 4.3 GW in 12 months) reaching 100% coverage of the low end of the new volume guidance and enhancing visibility on volume growth in 2017 Management focused on value creation: 23% ROCE, +9 p.p. y/y
– +32% y/y in revenues – +65%2 y/y in EBIT – +84%2 y/y in BN
– Working capital/revenues: 5,9% – €167mn net cash @ 09/30/2016
2016 volume and profitability targets upgraded
Approval of the merger between Gamesa and Siemens Wind Power by Gamesa's Shareholders, improving the competitive position and value-creation prospects
important
January-September 2016 Results 1. Firm orders and confirmation of framework agreements for delivery in the current and subsequent years, including 498 MW signed in Q3 16 and announced in Q4 16. 2. Growth using underlying figures pre-Adwen, excl. €29mn at EBIT level in M9 15 (no impact in M9 16) and +€4mn at net profit level in M9 15 and -€18mn in M9 16.
28 28
Resultados Enero-Septiembre 2016
Committed to respecting human rights and the environment We form part of the main sustainability and corporate responsibility indices
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FINANCIAL TERMS Contribution margin: The contribution Margin (CM) is the difference between revenues and variable costs. EBIT is obtained by deducting the fixed costs, structure costs (SG&A - “Selling, General and Administration Expense”) and depreciation and impairments from the contribution margin. The contribution margin analysis allows determine break-even point, it is the activity volume where the contribution margin offsets the fix costs. Contribution Margin is usually presented as a ratio linked to sales, considering as sales the revenues from Financial Statements (total or by segments, as appropriate). Reported EBIT (Earnings before Interest and Taxes):operating profit before income from equity-accounted affiliates, net financial results including exchange gains/losses, taxes and income from discontinued operations/available-for-sale assets and non-controlling interests. Underlying EBIT (Earnings Before Interest and Taxes): Reported EBIT excluding the impact of special items that are non-recurring or fall outside the normal course of business (i.e. unusual or unlikely to recur). Reported EBIT margin: ratio obtained by dividing reported EBIT by revenues in the period (i.e. turnover in the consolidated profit and loss account). Underlying EBIT margin: ratio obtained by dividing underlying EBIT by revenues in the period (i.e. turnover in the consolidated profit and loss account). Break-even point: may be defined in terms of EBIT or net profit. Minimum number of units that must be sold to achieve zero EBIT or net profit. Above that minimum volume of production or sales, the company is profitable in EBIT or net profit terms. Reported net profit: consolidated profit for the year attributable to the parent. Underlying net profit: reported net profit excluding the net (after-tax) impact of non-recurring items Underlying net profit per share (EPS): the result of dividing underlying net profit by the average number of shares outstanding in the period (excluding treasury shares). Pre-Adwen figures: in its presentations to the financial markets, in addition to underlying and reported figures from the profit and loss account, Gamesa reports pre-Adwen figures, which exclude Adwen as an equity-accounted item Since it is carried by the equity method, Adwen affects the group figures below the EBIT line; consequently, EBIT pre-Adwen and reported EBIT refer to the same amount, except in 2015. In 2015, reported EBIT included €29mn of capital gains from creating Adwen that were not included in EBIT pre-Adwen or in underlying EBIT as it is an item that will not recur in the future. Therefore, in 2015, EBIT pre-Adwen matches underlying EBIT but not reported EBIT. Net financial debt/(cash): gross interest-bearing debt (i.e. interest-bearing debt, both current and non-current plus other current and non-current liabilities that are classified as financial liabilities, plus liability financial derivatives) LESS cash and cash equivalents, financial derivatives and other current financial assets.
January-September 2016 Results
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Working capital: capital invested in working assets net of net working liabilities required for the ordinary course of business. XXXXXX It is calculated as the difference between current assets and current liabilities, excluding any item that is classified as net financial debt (e.g. cash and cash equivalents). Working capital is the sum of: inventories, trade and other accounts receivable (including related companies), due from public authorities and other non-financial current accounts receivable, LESS: trade and other accounts payable (including related companies), due to public authorities, and other non-financial current liabilities. Working capital/revenues: ratio calculated as working capital at any given date divided by the revenues in the twelve months prior to that date. Capital Expenditure (Capex): investments made during the period in productive fixed assets (tangible and intangible) in order to generate future profits (and maintain the capacity to generate current capacity, in the case of maintenance capex). The amount of capital expenditure matches the items "Investments in intangible assets" and "Investments in property, plant and equipment" in the Statement of cash flows. Gross operating cash flow: amount of cash generated by the company's ordinary operations, excluding working capital and capital expenditure (capex). Gamesa reports the flow of net financial expenses under gross operating cash flow. Gross operating cash flow is obtained by adding, to reported income for the period, the
Net operating cash flow: the result of deducting working capital from gross operating cash flow. Gamesa reports the cash impact of non-recurring items (non-recurring provisions or non-recurring income with a cash impact) under operating cash flow. Free cash flow: obtained by deducting capital expenditure (capex) from operating cash flow. It indicates the funds available for use to distribute dividends, buy back shares, pay down debt or other corporate activities not related to the day-to-day business. Return On Capital Employed (ROCE): ROCE is a measure of profitability and efficiency on capital invested (equity and debt) that assesses the operating assets' capacity to generate profits. ROCE is calculated as EBIT in the period, net of taxes, divided by average capital employed in the period. Capital employed is defined as net equity plus net financial debt; the average is calculated as the arithmetic mean of capital employed at the beginning of the year and the end of the period. The tax rate in the period is the average rate estimated for the period in which ROCE is measured. ROCE is calculated for 12-month periods: for interim periods that do not amount to a full year, the EBIT net of taxes in the last twelve months is divided by average capital employed in that period. In order for ROCE to be the best representation of operating assets' capacity to generate profit, underlying EBIT is used, eliminating any special items that are not expected to recur in the future.
January-September 2016 Results
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OTHER INDICATORS: Coverage of WTG sales volume: the sales coverage ratio expresses the likelihood of achieving the WTG sales volume targets set by the company for a given
commitment is expressed as a range, the mid-point of the range is used. Where the commitment is expressed as a minimum volume, the ratio is calculated using that minimum volume. Book-to-bill: ratio of order intake (in MW) to activity/sales in the same period (MWe). The Book-to-bill ratio gives an indication of the future trend in sales volume. MWe: an indicator of activity (a physical unit of sale) used to measure wind turbine generator manufacture in terms of work in progress. Manufacturing begins to be accounted for with the production of the nacelle, followed by the rotor and tower, up until a unit of manufacturing (MWe) is completed. The MWe indicator does not reflect post-manufacturing processes (civil engineering, installation, commissioning, etc.), which also generate monetary revenues. Average Selling Price (ASP): average monetary revenue collected by the Wind Turbine division per unit sold (measured in MWe). ASP is affected by a number
Cost of energy (LCOE/COE): the cost of converting a source of energy, e.g. wind, into electricity, measured in monetary units per MWh. It is calculated taking account of all costs incurred during the asset's life cycle (including construction, finance, fuel, operation and maintenance, taxes and incentives), divided by the total output expected from the asset during its useful life.
January-September 2016 Results
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“This material has been prepared by Gamesa Corporación Tecnológica, S.A., and is disclosed solely for information purposes. This document contains declarations which constitute forward-looking statements, and includes references to our current intentions, beliefs or expectations regarding future events and trends that may affect our financial condition, earnings and share value. These forward-looking statements do not constitute a warranty as to future performance and imply risks and uncertainties. Therefore, actual results may differ materially from those expressed or implied by the forward-looking statements, due to different factors, risks and uncertainties, such as economical, competitive, regulatory or commercial factors. The value of any investment may rise or fall and, furthermore, it may not be recovered, partially or completely. Likewise, past performance is not indicative of future results. The facts, opinions, and forecasts included in this material are furnished as of the date of this document, and are based on the company’s estimates and on sources believed to be reliable by Gamesa Corporación Tecnológica, S.A., but the company does not warrant their completeness, timeliness or accuracy, and, accordingly, no reliance should be placed on them in this connection. Both the information and the conclusions contained in this document are subject to changes without notice. Gamesa Corporación Tecnológica, S.A. undertakes no obligation to update forward-looking statements to reflect events or circumstances that
The results and evolution of the company may differ materially from those expressed in this document. None of the information contained in this document constitutes a solicitation or offer to buy or sell any securities or advice or recommendations with regard to any other transaction. This material does not provide any type of investment recommendation, or legal, tax or any other type of advice, and it should not be relied upon to make any investment or decision. Any and all the decisions taken by any third party as a result of the information, materials or reports contained in this document are the sole and exclusive risk and responsibility of that third party, and Gamesa Corporación Tecnológica, S.A. shall not be responsible for any damages derived from the use of this document
This document has been furnished exclusively for information purposes, and it must not be disclosed, published or distributed, partially or totally, without the prior written consent of Gamesa Corporación Tecnológica, S.A. In the event of doubt, the Spanish language version of this document will prevail."
January-September 2016 Results
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January-September 2016 Results